Summary of Benefit Plan Changes and Clarifications

Transcription

1 July 2006 Summary of Benefit Plan Changes and Clarifications Retired Employees Formerly Represented by IAM 725, SPFPA 159 and 160, IUOE 501 (Weldors) and 501 (Engineers), AFSO 1/SPFPA, DASO, and IBT 848 (Firefighters) This Update summarizes the collectively bargained and administrative changes and clarifications that will affect your benefit plans and updates your summary plan descriptions. The effective date of each change is September 1, 2006, unless otherwise noted. The changes and clarifications in this Update will apply to you if you are a retired employee of The Boeing Company (the Company ) who was formerly represented by Table of Contents International Association of Machinists and Retiree Medical Plan Choices... 2 Aerospace Workers, Local No International Union, Security, Police and Fire Professionals of America (SPFPA), Local No Summary of Medical Plan Changes... 2 Early Retirees...2 Medicare-Eligible Retirees...4 International Union, Security, Police and Fire Eligibility... 4 Professionals of America (SPFPA), Local No Eligible Dependents of Retired Employees...4 Prescription Drug Program... 5 International Union of Operating Engineers (IUOE), Prescription Drug Program Schedule of Benefits.5 Local No. 501 (Weldors). Retail Pharmacy Card Program...6 International Union of Operating Engineers (IUOE), Local No. 501 (Engineers). American Federation of Security Officers (AFSO), Local No. 1/Security, Police and Fire Professionals of America. Douglas Association of Security Officers (DASO). International Brotherhood of Teamsters Local No. 848 (Firefighters). This Update is for your information and is being provided to you as required by Federal law. No action on your part is required. The changes and clarifications in this Update apply to the McDonnell Douglas Group Life, Disability & Health Benefits Plan (Plan 529). Mail-Order Program...6 Pharmacy Management...6 Prescription Drug Program Exclusions...7 Traditional PPO... 7 Schedule of Benefits...7 TRICARE Supplement Plan... 9 Retiree Medical Plan Contributions Retiree Life Insurance Plan Retiree AD&D Plan For More Information Plan Amendment Information Copyright 2006 Boeing. All rights reserved. BOEING is a trademark of Boeing Management Company. A

2 RETIREE MEDICAL PLAN CHOICES Effective September 1, 2006, medical plan choices will be revised as follows: All Locations Regence Basic Indemnity. Regence Basic PPO. Regence Non-Medicare Traditional PPO. Regence Traditional Indemnity. Arizona PacifiCare HMO. Secure Horizons HMO. California Health Net HMO. Kaiser Permanente HMO. PacifiCare HMO. Secure Horizons HMO. Senior Advantage HMO. Seniority Plus HMO. TRICARE Supplement Plan. Florida Aetna HMO. Health First HMO. TRICARE Supplement Plan. Nevada PacifiCare HMO. Secure Horizons HMO. Oklahoma PacifiCare HMO. Secure Horizons HMO. Contact the Boeing Service Center through Boeing TotalAccess for details. SUMMARY OF MEDICAL PLAN CHANGES Early Retirees Effective September 1, 2006, the medical plans for early (under 65) retirees will be revised as follows: 2

3 The Point-of-Service Plan and Out-of-Network Area Plan will be replaced with the non-medicare Traditional PPO as summarized on page 7. Under the Traditional PPO Primary care physicians and specialist referrals no longer will be required; you may receive care from any licensed provider covered under the plan. The network payment level will apply in areas where there are no qualified network providers. Deductibles will apply to network and nonnetwork services. The lifetime maximum benefit will apply to network and nonnetwork services. The new Basic PPO will be introduced. The Basic PPO will have the same benefits as the Traditional PPO, except the deductible amounts will differ as follows: Network deductible will be $1,000 per individual ($3,000 per family). Nonnetwork deductible will be $2,000 per individual ($6,000 per family). The TRICARE Supplement Plan will be introduced as described on page 9 and will be available to eligible military retirees and dependents of active duty military personnel. The vision care program through Vision Service Plan will be offered to retired employees and their dependents enrolled in the TRICARE Supplement Plan. HMOs will be revised as follows: A $50 copayment will apply to each emergency room visit. (Note: This copayment already applies to Health First HMO.) A $250 copayment will apply to each inpatient hosptial confinement under the Health Net, PacifiCare, and Kaiser HMOs. A $200 copayment will apply to each inpatient hospital confinement under the Aetna and Health First HMOs. Out-of-pocket maximums will be $2,000 per individual ($4,000 per family). The out-of-pocket maximum for Kaiser HMO will remain $1,500 per individual ($3,000 per family). The following changes will apply only to the Health First HMO: o o A $15 copayment will apply to one eye examination every 12 months. Prescription drugs will be covered as described in the chart below. Prescription drugs will be covered according to the following tiers: Tier 1: Certain generic drugs Tier 2: The majority of generic drugs Tier 3: Brand-name drugs without an equivalent generic drug alternative; certain high-cost generic drugs Tier 4: Brand-name drugs with an equally effective, lower-cost generic alternative or with a Tier 3 drug alternative Tier 5: Brand-name, high-technology drugs Participating Pharmacy $2 copayment tier 1; $5 copayment tier 2; $10 copayment tier 3; $30 copayment tier 4; 3

4 $60 copayment tier 5; 30-day supply Mail-Order Program $12 copayment tier 1; $12 copayment tier 2; $25 copayment tier 3; $45 copayment tier 4; $150 copayment tier 5; 90-day supply For details on your plan options, contact the Boeing Service Center through Boeing TotalAccess. The new Traditional PPO and TRICARE Supplement Plan are summarized beginning on page 9. Medicare-Eligible Retirees Effective September 1, 2006, the Medicare Supplement PPO and Medicare Indemnity Plan will be replaced with the Medicare Traditional Indemnity and Medicare Basic Indemnity Plans. These new plan options will have the same benefits as the Traditional PPO, including the changes described on page 2, except the deductible amounts will differ as follows: Under the Medicare Traditional Indemnity Plan, the network deductible will be $250 per individual ($750 per family). Under the Medicare Basic Indemnity Plan, the network deductible will be $1,000 per individual ($3,000 per family). ELIGIBILITY Eligibility provisions will be as follows (see page 9 for information about the TRICARE Supplement Plan): If you attain age 55 with 10 years of service by September 1, 2006, current retiree medical eligibility will continue. If you have not attained age 55 with 10 years of service by September 1, 2006, you must be age 55 or qualify for disability retirement and have 15 or more years of vesting service under a Company-sponsored retirement plan. Alternatively, you may retire as early as age 50 if you have 30 or more years of vesting service under a Company-sponsored retirement plan. Eligible Dependents of Retired Employees If you retire with a pension benefit commencement date on or after September 1, 2006, dependents not covered at the time of your retirement (including a new spouse, same-gender domestic partner, or dependent child) cannot be enrolled later unless your dependent was eligible for coverage on your retirement date and waived coverage because he or she had other employer-sponsored coverage in effect. To enroll a dependent in this instance, you must enroll the dependent within 60 days from the day he or she loses the other coverage. Coverage will be offered to eligible same-gender domestic partners and children of eligible same-gender domestic partners who are enrolled on or before September 1,

5 PRESCRIPTION DRUG PROGRAM The prescription drug program described here is available to retired employees and dependents in the following plans: Non-Medicare Traditional PPO. Non-Medicare Basic PPO. Medicare Traditional Indemnity Plan. Medicare Basic Indemnity Plan. This program offers two coverage options for prescription drugs and medicines: Retail pharmacy card program you can use the pharmacy card to facilitate reimbursement when you obtain covered prescriptions from a participating retail pharmacy. Mail-order program called Medco By Mail. A formulary applies to all retail pharmacy and mail-order purchases. (A formulary is a list of drugs determined to be effective in both cost and treatment and approved by the Food and Drug Administration [FDA]. A nonformulary drug also may be effective for treatment but is not as cost-effective as formulary or generic drugs. A group of practicing physicians and pharmacists routinely reviews drugs to include in the formulary. If clinical data show several drugs are equally effective, the most cost-effective drug usually is chosen. The formulary may change from time to time.) There are three categories of prescription drug purchases: Generic drugs that are chemically and therapeutically equivalent to their brand-name counterparts but usually cost less. Brand-name formulary brand-name drugs selected for the formulary based on cost and effectiveness. Brand-name nonformulary brand-name drugs not selected for the formulary. The program includes utilization management services (see Pharmacy Management on page 6) to help ensure cost-effective, clinically appropriate treatment. Prescription Drug Program Schedule of Benefits Prescription Drug Program Schedule of Benefits The prescription drug program is administered by Medco Health Solutions, Inc. (the service representative). Participating retail pharmacy (up to a 30-day supply) Mail-order program (Medco By Mail; up to a 90-day supply) Generic Brand-Name Formulary Brand-Name Nonformulary $5 copayment $15 copayment $30 copayment $10 copayment $30 copayment $60 copayment 5

6 Prescription Drug Program Schedule of Benefits The prescription drug program is administered by Medco Health Solutions, Inc. (the service representative). Nonparticipating retail pharmacy Generic Brand-Name Formulary Brand-Name Nonformulary Not covered Not covered Not covered Nonnetwork mailorder Participating pharmacy without identification card Retail Pharmacy Card Program This program covers medically necessary prescription drugs required by Federal or state law to be prescribed in writing by a physician or dentist and dispensed by a licensed pharmacist. Covered prescriptions include legend drugs, contraceptive medications, smoking cessation drugs, self-administered injectable drugs, insulin, needles and syringes, test strips, lancets, and alcohol swabs. Prior authorization may be required for certain medications. The retail pharmacy card program covers up to a 30-day supply. Mail-Order Program The Medco By Mail program covers medically necessary prescription drugs and medicines required by Federal or state law to be prescribed in writing by a physician or dentist and dispensed by a licensed pharmacist. Covered prescriptions include legend drugs, contraceptive medications, smoking cessation drugs, self-administered injectable drugs, insulin, needles and syringes, test strips, lancets, and alcohol swabs. Prior authorization may be required for certain medications. Medco By Mail covers up to a 90-day supply per prescription or refill. Authorized refills are covered only after the initial order has been used. Certain controlled substances are subject to quantity limits. Unless the physician indicates otherwise, you will receive a generic equivalent of the prescribed drug when available and permissible under the law. You also may receive a different brand that is medically equivalent. Pharmacy Management Specific drugs are reviewed by the prescription drug program service representative at the point of sale to determine if your prescription is covered by the plan, clinically appropriate, and consistent with usage guidelines. Mandatory Generic Program To encourage use of generic alternatives, if a generic equivalent drug is manufactured, but a more costly brand drug is dispensed, you pay the amount shown in the Schedule of Benefits for generic drugs plus the brand vs. generic cost difference whether you or your physician requests the brand drug. 6

7 Prescription Drug Program Exclusions The following items are excluded under both the retail pharmacy card program and the mail-order program: Any prescription filled in excess of the number prescribed by the physician or any refill after one year from the date of the prescription. Any prescription for which the person is eligible to receive benefits under another employer s group benefit plan or a workers compensation law or from any municipal, state, or Federal program. Any service or supply otherwise excluded by the Non-Medicare Traditional PPO, the Non-Medicare Basic PPO, the Medicare Traditional Indemnity Plan, or the Medicare Basic Indemnity Plan. Appliances or devices, such as blood glucose monitors or other nondrug items, including but not limited to therapeutic devices and artificial appliances. This exclusion does not apply to needles or syringes or to test strips, lancets, or alcohol swabs. Charges for the administration or injection of any drug. Delivery or handling charges. Drugs dispensed during an inpatient admission by a hospital, skilled nursing facility, sanatorium, or other facility. Experimental drugs or drugs used for investigational purposes. Fertility agents, unless approved by the service representative. Immunizing agents or allergy serum. Infusion therapy drugs, except as described in the home health care benefit. Medications to treat sexual dysfunction, unless the patient is being treated for a diagnosed medical condition. Obesity drugs, unless approved by the service representative. Over-the-counter drugs. Prescriptions purchased from a nonparticipating pharmacy or nonnetwork mail-order program. Prescriptions that are not medically necessary to treat an illness, injury, or other covered condition, except as specifically provided by the program. Replacement of lost or misplaced prescriptions. TRADITIONAL PPO Schedule of Benefits Highlights of the Traditional PPO for non-medicare retired employees are in the following table: Traditional PPO The Traditional PPO is administered by Regence BlueShield (the service representative). Annual deductible Network $250 per individual; $750 per family of three or more Nonnetwork $500 per individual; $1,500 per family of three or more; nonnetwork charges apply toward the network deductible 7

8 Traditional PPO The Traditional PPO is administered by Regence BlueShield (the service representative). Network Nonnetwork Coinsurance 90% 60% Office visit 90% 60% Annual out-of-pocket maximum (including the annual deductible) $2,000 per individual; $4,000 per family of two or more, but not more than $2,000 for any one person $4,000 per individual; $8,000 per family of two or more, but not more than $4,000 for any one person; nonnetwork charges apply toward the network maximum Lifetime maximum benefit $1.5 million per individual (network and nonnetwork combined); includes benefits paid under the prescription drug program Emergency room Mental health treatment (including eating disorders) Covered inpatient, partial hospital, residential, or intensive outpatient services Covered outpatient services Substance abuse treatment Covered inpatient, partial hospital, residential, intensive outpatient, or outpatient services Preventive care Routine physical examinations (for employees, spouses, and children age 2 and over) 90% after $50 copayment; 60% after $50 copayment for nonemergency care; deductible applies 90% when referred by Boeing behavioral health manager; deductible does not apply 90% when referred by Boeing behavioral health manager; deductible does not apply 90% when referred by Boeing behavioral health manager; deductible does not apply; $7,500 network maximum per course of treatment Limit two courses of treatment lifetime maximum (network and nonnetwork combined) 100% (deductible does not apply) up to $500 maximum per covered examination including related laboratory and X-ray charges, routine Pap tests, mammograms, and prostate screenings See network provisions 60% when not referred by Boeing behavioral health manager; up to 20 days per year 60% when not referred by Boeing behavioral health manager; up to 20 visits per year 60% when not referred by Boeing behavioral health manager; $2,500 maximum per course of treatment (accrues toward the $7,500 network maximum) Limit two courses of treatment lifetime maximum (network and nonnetwork combined) Not covered when received in a network service area 8

9 Traditional PPO The Traditional PPO is administered by Regence BlueShield (the service representative). Network Nonnetwork Well child benefits (for children under age 2) Temporomandibular joint dysfunction and myofascial pain dysfunction syndrome (TMJ/MPDS) treatment 100% (deductible does not apply); covered in accordance with American Academy of Pediatrics guidelines and as recommended by doctor 50% up to $3,500 lifetime maximum Not covered when received in a network service area TRICARE SUPPLEMENT PLAN Effective September 1, 2006, a TRICARE Supplement Plan will be introduced for eligible employees and retired employees under age 65 and their eligible dependents. The TRICARE Supplement will be available to members enrolled in TRICARE Standard, Extra, or TRICARE Prime. Under the TRICARE Supplement Plan, TRICARE coverage will be primary and TRICARE Supplement Plan coverage will be secondary. The TRICARE Supplement Plan will pay most eligible charges not paid by TRICARE, including deductibles, coinsurance, and excess charges. The schedule of benefits for TRICARE Standard and Extra members will be as follows. TRICARE Standard and Extra Schedule of Benefits The TRICARE Supplement Plan is underwritten by the Hartford Life Insurance Company and is administered by The Association & Society Insurance Corporation (ASI, the service representative). Covered dependents Fiscal year outpatient deductible (October 1 September 30) Lifetime maximum benefit Inpatient military hospital care (for military retirees and dependents) Inpatient civilian hospital care (for military retirees and dependents) Outpatient services (surgery, X-ray, laboratory, office visits, well baby care, accident, emergency care, home health care) Prescription drugs Spouse; dependent children to age 21 or to age 23 if full-time students (unless disabled and continue to have TRICARE) Reimburses deductible amounts (for military retirees, $150 per individual, $300 per family) Unlimited Reimburses the daily subsistence fee Reimburses your cost share Reimburses outpatient deductible and your cost share Reimburses the TRICARE copayment for network or mail-order pharmacy; reimburses the TRICARE 9

10 TRICARE Standard and Extra Schedule of Benefits The TRICARE Supplement Plan is underwritten by the Hartford Life Insurance Company and is administered by The Association & Society Insurance Corporation (ASI, the service representative). deductible and copayments for nonnetwork pharmacy 10

11 The schedule of benefits for TRICARE Prime members will be as follows. TRICARE Prime Schedule of Benefits The TRICARE Supplement Plan is underwritten by the Hartford Life Insurance Company and is administered by The Association & Society Insurance Corporation (ASI, the service representative). Covered dependents Fiscal year outpatient deductible (October 1 September 30) Lifetime maximum benefit Inpatient military hospital care (for military retirees and dependents) Inpatient civilian hospital care (for military retirees and dependents) Outpatient services (surgery, X-ray, laboratory, office visits, well baby care, accident, emergency care, home health care) Prescription drugs Network HMO Nonnetwork Point-of-Service (POS) Option Spouse; dependent children to age 21 or to age 23 if full-time students (unless disabled and continue to have TRICARE) None Unlimited Reimburses the daily subsistence fee Reimburses eligible TRICARE Prime copayments and cost share Reimburses eligible TRICARE Prime copayments and cost share Reimburses the TRICARE copayment for network or mailorder pharmacy Reimburses 50% of POS deductible ($300 per individual, $600 per family) Reimburses 50% of POS deductible and 50% POS cost share plus 100% of applicable excess charges Reimburses 50% of POS deductible and 50% POS cost share plus 100% of applicable excess charges Reimburses 50% of POS deductible and 50% POS cost share plus 100% of applicable excess charges RETIREE MEDICAL PLAN CONTRIBUTIONS The current retiree medical plan contribution methodology will continue to apply. In addition, If you retire during the term of the new collective bargaining agreement, you will continue under the current contribution arrangements that apply to employees who retire on or after January 1, Effective September 1, 2006, you will no longer be eligible for Medicare Part B reimbursements from the Company if you retire and are not eligible for retiree medical. RETIREE LIFE INSURANCE PLAN If you are hired on or after September 1, 2006, and have a benefit commencement date under the Employee Retirement Income Plan of McDonnell Douglas Corporation Hourly West Plan (or industry pension plan in 11

12 the case of IUOE 501 [Engineers]) on or after that date, you will not be eligible for retiree life insurance coverage. For participants in the Hourly West Retirement Plan, the $2,000 death benefit under that plan will continue. RETIREE AD&D PLAN Effective September 1, 2006, the Retiree AD&D Plan will be revised as follows: If you are hired on or after September 1, 2006, and have a benefit commencement date under the Employee Retirement Income Plan of McDonnell Douglas Corporation Hourly West Plan (or industry pension plan in the case of IUOE 501 [Engineers]) on or after that date, you will not be eligible for retiree AD&D coverage. The service representative will change to AIG. FOR MORE INFORMATION Contact the Boeing Service Center through Boeing TotalAccess. On the World Wide Web: Log on to using your BEMS ID number (or Social Security number) and your Boeing TotalAccess password. By telephone: Call TTY/TDD services are available at You must have your Social Security number and your Boeing TotalAccess password. Representatives generally are available during regular business hours. PLAN AMENDMENT INFORMATION This Update is a summary of material modifications to your summary plan description for the McDonnell Douglas Group Life, Disability & Health Benefits Plan (Plan 529). This document is provided to you in accordance with the Employee Retirement Income Security Act of 1974, as amended. If there is any discrepancy between this Update and the Plan document listed above, the Plan document will control. Although the Company fully intends to continue the Plan described here, the Company reserves the right to change, modify, amend, or terminate it at any time and for any reason for employees, former employees, retirees, and their dependents. 12